In large bowl cream together butter, sugar and lemon rind with electric mixer. Blend in flour and cereal. Beat in egg yolks, lemon juice and milk. In a separate bowl, beat egg whites with clean beaters until stiff. Fold egg whites into butter mixture and pour into an 8x8 inch baking dish.
Line a roasting pan with a damp kitchen towel. Place baking dish on towel, inside roasting pan, and place roasting pan on oven rack. Fill roasting pan with boiling water to reach halfway up the sides of the baking dish. Bake 30 to 45 minutes, or until pick inserted in center comes out clean.